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Aditya Birla Minacs Vision 2020
 

Aditya Birla Minacs Vision 2020

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Minacs’ Vision 2020 captures the business strategies that leaders need to prioritize as they head into the next decade given the market conditions and global environment.

Minacs’ Vision 2020 captures the business strategies that leaders need to prioritize as they head into the next decade given the market conditions and global environment.

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    Aditya Birla Minacs Vision 2020 Aditya Birla Minacs Vision 2020 Document Transcript

    • market focus value partnering agility specialized partners grow revenues variable-ize costs core sourcingexpert sourcing vision business sustainability millennial workforce 2020 an Aditya Birla Minacs thought paper
    • vision 2020 To manage economic uncertainty with agility while enhancing operational stability... A New Vision … As a business leader what are your strategic priori es heading into the new decade, given the market condi ons and global environment today? Do you discern rapid changes and new challenges that are rendering tested business strategies obsolete? Are new and different solu ons now required to achieve strategic impera ves like growth and compe veness? During the last few years our discussions with many client execu ves consistently threw up a growing belief that significant forces were changing the world, perhaps forever. What then are CXOs focusing on today? • Sustained overall ghtness in global financial leverage, enhanced transparency norms and stronger regulatory controls are driving an increasing leadership focus on opera onal performance. • This focus in C-suite agendas is leading to a relentless pursuit of resource produc vity; to delivering results without necessarily owning the producing resources or assets. • To manage the uncertain es of the global economic environment, strategic flexibility is being valued as more cri cal than sheer economies of scale. • Leveraging technology, businesses are preferring to be organized around their markets rather than supply chains for market focus and speed. In the following pages, we present our insights with perspec ves on how these changes are coming together and offer our proposed solu ons for execu ves juggling enterprise agility with business sustainability.2
    • agility The New Normal changing economic order millennial workforceEnterprises are looking for strategies that ensure sustainable business accelerationin uncertain and volatile times.W hile true agility and business sustainability have been on leadership and best prac cechecklists for decades, con nued globaliza on and the • Informa on explosion riding cloud, mobile and social technologies—with digital convergence changing the ways media, content, services andrecent economic turmoil are driving a New Normal. products are created, delivered and consumed.Contemporary strategic thinking is asser ng thatthe financial crisis is only one among a set of larger • Changing work paradigms—powered by anelemental forces at work in this decade; that the “always on everywhere”, technology enabled, andemerging economy is not just the trough of a business globalized environment, businesses are exploringcycle; and that there is no return to an earlier “business the upside poten al from various strategies foras usual”. What are these inescapable, fundamental how and where work is done; increased hungerforces? among organiza ons for the best talent across levels to provide strategic differen a on and• Con nued restructuring of the economic business momentum; and on-the-fly collabora on order laced with chronic recession—hardening leveraging social networks. regulatory changes, reduced financial leverage, increasing protec onism and transparency Our view is that these forces are likely to have significant requirements, and a growing inclusiveness impacts on business strategy throughout the second focus from governments, who will be especially decade of the 21st century. Clearly, the heightened challenged by unemployment and unemployability. uncertain es are driving an unprecedented search by organiza ons for more nimble opera ng and risk• Tectonic geopoli cal shi s transforming arbitrage models. markets—massive demographic transi ons, swelling third world urbaniza on, new growth in consump on to come from emerging markets with markedly different dynamics and consumer behavior. 3
    • vision 2020 nimbleness accelerate business “core” competencies industrialized processes knowledge-based Outsourcing at the beginning of the decade is already no longer just about service delivery; it’s about being responsible for clear business results for clients. W hile businesses have outsourced various “non- core” ac vi es for years, even centuries, outsourcing emerged as an organized, industry-wide Apart from cost management, providers drive decreased me-to-market, ensure more accurate output since work is done by “category” experts, and enhance value phenomenon over the last 20 years. Used as a strategy to the outsourcer’s business with up-to-date “domain to “variable-ize” cost structures, outsourcing took a knowledge” and best prac ces that vendors garner from great leap forward in the late 1990s, when offshoring mul ple clients. In fact, by progressively moving deeper added strategic advantage through cost takeout for into the value chain, outsourcing now provides the enterprises seeking agility and compe veness. While organiza on efficient ways to sustain and accelerate the global delivery model was built on the cost business. leverage pla orm, it also provided the advantage of tapping into the “world’s” talent pool, which when For example, Minacs’ broad outsourcing experience combined with modular process delivery, provided helps us to introduce cost savings, efficiencies and access to highly scalable, skilled workforces. During process improvements to several 24x7, business- this me, with outsourcing buyers driving the agenda, cri cal, mul -channel service lines for a Fortune outsourcing achieved the scale and cri cal mass to 100 healthcare client. Hundreds of our pa ent care sustain further evolu on. advisors in Manila manage requests from physicians, pharmacists and pa ents for prior authoriza on of On their part, providers designed and delivered prescrip on medica on based on the member’s health repeatable services that clients needed to succeed insurance plan. Our back office also provides account in a globalizing, compe ve, and o en fast-changing administra on, helps them plan be er coverage environment. As a result, the more common outsourced strategies, verifies new pa ent insurance, assists with processes have matured into sophis cated and change in therapy or insurance, enters appropriate “industrialized” or “commodi zed” capabili es billing codes and reauthorizes exis ng pa ent benefits. that both buyers and providers understand well—and In effect Minacs is delivering pharmacy benefits manage without great difficulty. management services to millions of this client’s health plan subscribers in North America.4
    • The goal? Enable enterprises to respond efficiently to market dynamics and strengthen cash flows, profitability and return on capital deployed. Business Process OnsiteOutsourcing Non-Core Business Drivers Focus Value IT ProjectsOutsourcing Time Evolu on of Outsourcing To mul ply business results enterprises are outsourcing end-to-end business func ons, looking for bundled solu ons that combine technology, infrastructure and capabili es While engaging with clients, analysts and industry outsource more func ons that, un l recently, were players, we increasingly came across instances of retained in-house—to drive much greater nimbleness execu ves seeking true partners to par cipate in their and flexibility. These newly outsourced ac vi es will business and take ownership for results—so that they not be volume-driven, transac onal work as in the past, can focus more sharply on their “core” competencies. but an expanding list of more knowledge-based and In a trend that will take shape and gather momentum judgment-intensive func ons “closer to the core” of throughout this decade, they will in fact clearly organiza ons. 5
    • vision 2020 value chain view variable-ize costs predictability scalability What Are Enterprises “Buying”? agility core sourcing vs. grow revenues As an organization seeking to outsource more complex functions, does your provider define your business as its core business? T o directly drive business outcomes, clients are outsourcing much higher levels of organiza onal core competencies. This core sourcing is being for a great deal of outsourced transac ons, especially volume-driven, repe ve, “low value” func ons. This in turn is likely to drive the industrializa on hardwired to business results. To complement this, of more IT and business process outsourcing (ITO/ enterprises are entrus ng providers with increasingly BPO), with business process management (BPM), larger swathes of end-to-end upstream and downstream cloud compu ng and virtualiza on technologies processes to unlock synergies from the seamless suppor ng standardiza on and scalability. For management of value chains. these industrialized processes, qualified providers must be commi ed to service excellence, operate with a Here is an example of a complex func on comprising zero defect, Six Sigma mindset; and invest in business several sub-processes that Minacs manages for a global process “u li es” that drive automa on, standards and automobile manufacturer. On occasion its service produc vity. dealerships are unable to completely repair a vehicle despite mul ple a empts. As per American lemon On the other hand, a Holy Grail for all businesses is to law, such cases subject our client to stringent vehicle grow revenues and customer s ckiness. Does buyback legisla on. Minacs acts on behalf of the client your outsourcing provider meet your consumers’ to nego ate buybacks, transport, repair or scrap, stated and unstated demands as a true extension transfer tle, remarket and disclose lemon law history of your brand? Does it understand how, given the to new buyers. This end-to-end opera on processes specifica ons of your products or services, each approximately 1,200 vehicles per year. consumer is “different”? To ensure consumer-specific brand experiences, consumeriza on will also impel For business agility and predictability, we believe providers towards inves ng in capabili es, analy cs and that organiza ons will con nue to “variable-ize” integrated mul -channel pla orms to improve customer costs seeking freedom from infrastructure and capex engagement. build-outs. Cost management will remain the driver6
    • Industry Knowledge Card Fraud vision 2020 Medical Record Cards/Loans Management Supply Chain Policy Management Healthcare Bank Clearinghouse Engineering Claims Processing Design Channel Revenue Cycle Auto Parts Management & Warranty Sales Direct Procurement Mortgage Servicing Technical Assistance Order to Cash Outsourced Telecom Indirect Cycle Financial Value Vendors Research Partners Database Billing Procurement Customer Cleansing Outbound Sales Source To Pay Billing Product Support Cycle Recruitment Contact Centers HR Channel Legal Services Print Mail Support Accounts Finance Customer Service Receivable Controllership Contact Centers Loyalty Management Employee Accounts Payable Order Management Shareholder Services KnowledgeKnowledge: The New Fron erCore sourcing is the growing trend moving fromrou ne processing to unstructured, judgment-oriented work ( ll now retained in-house)—toobtain be er value chain visibility and agility 7
    • vision 2020 core focus strategic agility “Core” Beliefs Uniquely posi oned as outsourcing partner to Fortune 500 and mid-market firms, the early signs we saw of significant changes shaping the world told us that the me was ripe for enterprises to embrace non-tradi onal business models. • Enterprises will increasingly focus on their “core” and depend on an ecosystem of specialized partners to deliver the rest of their value chains. • Globaliza on is here to stay—the world will con nue to get “fla er”. • More and more enterprises will embrace increasingly virtual business models to enhance agility and compe veness. • Businesses will con nue to look to “variable-ize” their cost structures. • How work is performed in and across enterprises will con nue to change: home based employees, mobile and edge devices, embedded smart chips, cloud compu ng … and more. Globaliza on and compe on drove outsourcing evolu on through its early years. Given the New Normal’s disrup ve challenges, CXOs across the world are seeking to enable sharper focus on core areas and to build agilility into their opera ng frameworks. By crea ng “on demand” networks of providers and partners for ac vi es that are not core to their business, enterprises are effec vely seeking business virtualiza on.8
    • New StrategiesTo meet the imperatives of this decade, organizations are steadily virtualizingbusinesses driven by significant and elemental paradigm changes.A ll-pervasive technologies and a fla er world are enabling enterprise value chains withincreasing intelligence and speed. As a result, smart an Indian bank recently outsourced its payments clearinghouse to Minacs. Tradi onally considered a “core banking func on”, since a clearinghouse impactsorganiza ons can realize great opportuni es for customer payments, inter-bank, se lements andbusiness accelera on. However, to balance agility liabili es, Minacs today runs this en re back officewith business sustainability in the decade ahead, opera on as a complete solu on.organiza onal “core” competencies will be constantly re-evaluated and new determina ons of compe veness Business virtualiza on is reengineering tradi onalmade. What is emerging is a more sophis cated need workforces in developed countries and in somefor outsourcing maturity on both sides of the table. developing ones as well. While its apparent impact points to higher unemployment rates in westernA mature outsourcing industry will work with clients economies, “unemployability” rates are also a growingto ar culate what is required to succeed in the New concern. Though outsourcing opened up access toNormal. Distributed, “virtualized” clients will seek global talent pools in the past, unemployability due toclearer defini ons of business results, risk management, outdated skills and exper se could present a significantskills, and best prac ces—in their conversa ons with bo leneck to growth in several geographies and impedeproviders. business virtualiza on.A top 20 US bank exemplifies the new ways that Providers will therefore need to adopt a wholly newbusinesses are seeking to virtualize. Ini ally having mindset and develop access to exper se clusters tooutsourced its credit card dispute resolu on and fraud meet tougher client situa ons and work demands.detec on process, the bank has now entrusted Minacs They will also require to innovate different opera ngwith its en re card fraud inves ga on and forensics models for varying levels and complexi es of businessneeds so that it can focus on its core business. This client virtualiza on. The sophis ca on needed to managehas realized millions of dollars in savings from our an - more complex “core” func ons (and the risks associatedfraud specialty prac ce that has developed rela onships with performing work based on exper se or judgment)with law enforcement agencies to be er protect the will no doubt inject disrup ve change to exis nginterests of the client and its customers. Similarly, outsourcing engagement models. 9
    • vision 2020 How business is done and where work is performed are changing markets in unprecedented ways. W ith change happening at many complex, intertwined levels, it is difficult to spot and iden fy discrete strands. Equally challenging to • Digital convergence is coalescing industries such as telecom, technology infrastructure, media and entertainment (TIME) into a super industry, understand and predict their combined impact which provides not just the devices through which on business. While technology has been enabling content is consumed by digital consumers, but also automa on and integra on within organiza ons, it has the content itself, the hardware that produces it, also driven seamlessness and interoperability outside the networks that distribute it, and the so ware them with the advent of the Web and mobile devices. that runs all of the above. Technology has enabled new service delivery channels for businesses and provided more access points for their • Financial convergence is bringing together customers. banks, insurers, payment networks, retail and supply chain companies to help them “manage” Technology is not the only driver, though. Two decades globaliza on. of economic expansion (albeit with hiccups like the dotcom bubble), globaliza on, and demographic and • With recent interna onal ins tu onal failures, sociological changes have seeded other dimensions sovereign debt crises, and increasing cross border of change that are intersec ng in this present decade. trade and fund movements, transparency and While the tsunami of the recent recession seems to be control are cri cal for economic stability. On the most potent and visible force, other changes are as another level, regulatory convergence (such surely rewiring markets, and therefore businesses. What as that being driven by the Basel Accords) is at are some of these interwoven changes? And how will once opening up markets and also reining them in, they impact business leading up to 2020? bringing up unexpected avenues of collabora on.10
    • Digital Financial Regulatory 24x7 connectedness for The physical and supply Global open standards across millions of people and the chains are blurring to create new for billions of enterprise ecosystems, big data management and will schemes) and other businesses, throw up new technological regulators and market players are enabling seamless “transact-ability” and consistent ways of Demographic digital consumers, A Decade of Mul -Dimensional Change Many strains of fundamental change are converging to transform human interac on, consump on, work and lifestyle behaviors significantly• Another prism of change involves the millennial demographic subset is searching for and consuming genera on as it enters the workforce this products and services online, crea ng both decade in growing numbers. Also called Gen Y, it challenges and opportuni es for business. is recognizably different from past genera ons. It is remarkably comfortable working from These convergence trends are making decisions difficult anywhere and at any me. “Work-life blurs” and agility impera ve for businesses. To chart their are replacing “work-life balance”. Corporate HR strategic course in a virtualizing world, the enterprise policies and the employer-employee equa on must find partners that they can trust and work will change considerably to catalyze and manage with—to realize their goals in a complex, fast changing produc vity norms. Expect a leap in the number environment. of “independents” in workforces. Gen Y as a 11
    • vision 2020 point of view value partners unlock value chains seamless visibility Extending the accessshared outcomes to assets Enterprise Ecosystem new expert sourcing Value partnering is not about service delivery but “solution delivery” that solves real business challenges. With business virtualiza on, organiza ons are building func ons by performing “high value” work with their ability to access an interconnected and partnered scalability and at best-in-class levels sourced globally. ecosystem of assets, resources and capabili es. With core sourcing of key decision making func ons Outsourcing players are already beginning to offer much picking up pace, expert sourcing is a natural more than the tradi onal services from the industry’s progression to keep the enterprise ahead of the curve first 20 years. However, given this decade’s challenges, and to bring transforma onal value to business. clients are looking to create business impact across Expert sourcing will be a key partner solu on providing value chains—and not just standalone processes. enterprises with access to strategic exper se to achieve financial goals (revenues, costs, inventory, etc.), business To impact business outcomes, value partners must goals (new markets, product differen a on, market have end-to-end value chain visibility—to be able growth, etc.), and to manage risk—to drive overall agility to an cipate and iden fy business problems and and sustainability objec ves. proac vely offer solu ons. This means they must not only have high value, “closer to your core” capabili es, Of course temporary or project based outsourcing will but also the ability to successfully meld them with basic, con nue to be leveraged for lower value, high volume transac onal, automated and standardized work to tasks. However, core sourcing high value func ons will provide complete solu ons for a value chain. Being truly need a paradigm-shi forward from the earlier mindset embedded in your business, such partners will bring of “outsourcing” and “vendor management” towards deep and extensive exper se within both your industry “virtualizing business” with a symbio c, value-crea ng and fuc onal domains, and with your specific technology ecosystem of deeply engaged specialist partners. deployments. An insurance solu ons provider partners with Minacs to Globaliza on and technology advances are changing standardize and organize the diverse medical records of how work is performed. Where it is performed will pa ents/policy holders of large insurers; and support its assume even less significance if it opens doors to the patented medical record op miza on tool. In Bangalore, best talent-experience-cost equa ons worldwide. This qualified medical professionals (physicians, den sts, trend enables providers to take on knowledge-intensive pharmacologists and paramedics) process a mul -stage12
    • Outsourcing Vendor 2010 Value Partner 2020 As extended arm of the enterprise, rela onship is strategic; Outsourcer interfaces through its vendor management partner signs up for ownership and outsourcer welcomes func on to drive outsourcing objec ves embedded par cipa on Scope of rela onship focuses at business process level Uni ed end-to-end business func ons Focused on your business results and that of your customer Manages agreed SLAs and suppliers Technology, infrastructure, people and nancing o en not Comprehensive “solu oning” approach; partner takes on all “part of the deal” aspects in “structured deals” Li s and shi s exis ng processes that save money/ me Drives proac ve innova on, even business transforma on Performs not just knowledge-based but judgment-intensive Transac on processing, typically volume driven work func ons, and works seamlessly with the ecosystem (partners, regulators, etc.) Co-crea on mindsets on both sides within a gain-sharing/risk- Pay per transac on or per FTE reward framework Experience based exper se capable of driving value chains to Typically low knowledge levels of FTEs, more trainable skills unlock synergies and impact business Value Partnering Framework Partners that can s tch capabili es and technology together into complete business solu ons.workflow from digi zing medical files, and indexing to in framing long term priori es and take responsibilityabstrac ng and analyzing them. As a true extension for business results. With emerging markets as a keyof its value ecosystem, Aditya Birla Minacs helps the growth driver, such partners will drive proac ve andclient reduce me spent tracking down, reques ng and frugal innova on. Equally commi ed to year-over-sharing medical records, enhances medical inves ga on year performance improvement, they need to developaccuracy, and improves the clients’ claims processing sophis cated “solu oning” approaches to take onand legal staff throughput. your ongoing challenges; put their skin in the game and share in your risk reward equa ons; and operateTrue value partners will not only have knowledge of governance processes that manage risks and delivery—your business strategy, but will also bring new insight and outcomes.and a knowledgeable point of view. They will par cipate 13
    • vision 2020 Vision 2020 providers need to continuously and consistently work towards specific enterprise goals for business acceleration and sustainability. W hile seeking to build increasingly virtualized and asset-light business models that are more sustainable, enterprises are looking to compete and • Complete business solu ons that help enhance market focus by displaying not only deep understanding of your context and objec ves, but create higher value for their customers. To do their also of the upsides and risks of the New Normal. part, providers must offer relevant solu ons by evolving beyond the SLA based metrics required for more • Ability to deliver analy cs-driven visibility across commodi zed ac vi es and take shared ownership value chains that enables decision making and for business results. What are some cri cal components speed (enabled by co-crea on, gain-share based of these business solu ons? opera ng models, etc.) and provide strategic flexibility with global access to infrastructure, • Partner investments in reusable intellectual capability and technology ecosystems. property (e.g., applica on pla orms) to provide service elements packaged in modular solu ons. A virtualizing business should re-focus its enterprise These solu ons must include specifica ons that ecosystem, organiza onal structures, and strategies can be delivered to consistently and a zero error towards ensuring sustained business results. Its mindset powering standardized, industrial strength partners must commit to these goals and deliver process output that underwrites opera onal complete business solu ons that allow the performance. enterprise to focus on its true core. • Access to or ownership of infrastructure that This decade presents challenges that may be drives resource produc vity on one level unprecedented, but the emergent direc ons are clearly (e.g., deploying mobile technologies, workflow visible. While staying true to the basics of business, enablement of disparate systems across the value a new shared vision for 2020 with agile, innova ve chain) and scalability on another (e.g., cloud mindsets will help us to accelerate and capture the rich sourced applica ons, expert sourcing global delivery opportuni es of the years ahead. footprint, etc.).14
    • vision 2020 Forward… This paper is a compila on of our thoughts on business that began with some conversa ons among members of Minacs’ global leadership team while redra ing our Vision statement in 2009. What we heard from client execu ves as they discussed their challenges, priori es and strategies for dealing with change and uncertainty helped us crystallize those first insights over me into a firm point of view. Minacs leaders have shared some of these insights speaking at industry forums and to analysts globally. We received valuable con nuing confirma on of not just our perspec ve, but support for our proposed approaches such as value partnering as well. This paper encapsulates our “world view” of how we see business and outsourcing move forward over the next decade. More importantly, it underlines how we approach business. The term “New Normal” first came to our no ce from an eponymously tled essay published in The McKinsey Quarterly by Ian Davis in March 2009. We hope you enjoyed reading Vision 2020 and that it compels you to further explore its themes, especially business virtualiza on. Together, they have the power to drive and transform business as we know it today. We are keen to hear your thoughts—write in and tell us at: info@minacs.adityabirla.com. 15
    • accelerating business for a virtualizing worldAbout Aditya Birla MinacsWe are a leading business solu ons company that partners with global corpora ons in themanufacturing, retail, telecom, technology, media and entertainment, banking, insurance,healthcare and public sectors. We deliver superior business value through our Customer Lifecycle,Marke ng, Finance and Accoun ng, Procurement and IT solu ons and services. 20,300 Minacs Production of Aditya Birla Minacs Marketing and Communicationsexperts across 36 centers spanning Canada, Germany, Hungary, India, Jamaica, Philippines, theUK and USA power our solu ons to help our clients enhance revenues, profitability, and customerservice.Please visit www.minacs.adityabirla.com for more informa on.© October 2011 (Revised). Aditya Birla Minacs Worldwide Limited. All rights reserved. Minacs believes the informa on in thispublica on is accurate as of its publica on date; such informa on is subject to change without no ce. Minacs acknowledgesthe proprietary rights of the respec ve trademarks and product names of other companies. Data contained in this documentserves informa on purposes only.